40 years after the OPEC oil embargo — Where things stand on the shutdown

40 YEARS AFTER THE OPEC OIL EMBARGO: This week marks the 40 th anniversary of the start of the 1973 OPEC oil embargo that created the iconic long lines at gas stations and brought the U.S.’s role in the global petroleum market into sharp focus. Darren Goode has a must-read piece at what’s changed since then (and what hasn’t): “For the U.S., the oil cutoff would soon morph into a full-fledged Arab oil embargo, then into an energy crisis that sent domestic gasoline prices spiraling, spawned long lines at the pumps and introduced Americans to their new status as beggars in the world’s petroleum markets — victims to the whims of desert sheiks and every tremor from Tripoli to Tehran.

“The trauma of 1973 has shaped every presidency since then, and the U.S. is still absorbing its lessons. Each administration in the past four decades has called for achieving U.S. energy independence, and each has been lambasted for failing to come up with a national strategy for weaning the nation off foreign oil. Washington remains sharply divided on what such a strategy should entail: opening up more of the coastline to drilling, digging more coal, growing ethanol, building pipelines from Canada, erecting windmills and solar panels, or ‘all of the above.’” Pros can read Darren’s story here: http://politico.pro/GUuT3C

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BUT WAIT, THERE’S MORE: Pros can also check out Darren’s interview with James Schlesinger, Richard Nixon's defense secretary at the time. Here’s a teaser quote: “I sat next to President Nixon at a cabinet meeting and Nixon said to his cabinet members, ‘I don’t know whether this embargo will ever end.’ And I leaned over and I said, ‘Mr. President, you know we’ve been negotiating with the Saudis and we have an agreement.’ He said, ‘I know that Jim, but why should I be telling them?’” Check out more from the interview: http://politico.pro/1akwN4R

SHUTDOWN CONTINUES — WHERE THINGS STAND: Last week saw several agencies that had saved up some rainy day funds drain their bank account and institute shutdown plans. The Nuclear Regulatory Commission ran out of money mid-week, sending home most workers except on-site resident inspectors and some management employees. The Energy Information Administration closed shop on Friday afternoon, signaling the end of energy market reports until the shutdown is over. The State Department said the shutdown is affecting its review of the Keystone XL pipeline because liaisons at EPA and elsewhere have been sent home. And the National Science Foundation will likely have to pull U.S. researchers just arriving in Antarctica for the summer, potentially threatening the busy research season and jeopardizing long-running observations and experiments.

— With much of EPA and Interior already furloughed, that leaves FERC and some parts of DOE that are operating on carryover funds or multi-year appropriations as the only federal energy agencies still open. It’s not yet known if or when those agencies might run out of funds and have to implement shutdown plans.

MORE PARKS OPENING: With some states agreeing to front the costs of opening some national parks and monuments for a while, tourist hotspots like the Grand Canyon, Statue of Liberty, Mount Rushmore and Rocky Mountain National Park are re-opening, at least for now. The move has drawn criticism from Republicans who question the administration’s motives and piecemeal approach to opening the parks, but the administration remains adamant that Congress pass a bill funding the full government rather than targeted portions like national parks.

SENATE APPROVES OFFSHORE DRILLING BILL, BUT PATH FORWARD UNCLEAR: The Senate over the weekend passed legislation by unanimous consent that would execute the U.S.-Mexico Transboundary Hydrocarbons Agreement, lifting a moratorium on drilling along the U.S.-Mexico maritime border and letting the Interior Department enforce safety regulations there as part of an deal with Mexico. The House has also cleared a bill approving the agreement, but added a rider protecting oil and gas companies from a Dodd-Frank rule requiring them to disclose payments made to foreign governments (the SEC is rewriting that rule after a court struck it down recently). That addition garnered a veto threat from the White House, and the House bill has gone nowhere in the Senate.

Going forward: A House Natural Resources Committee aide didn’t tip his hand about whether the House might consider the Senate’s version of the bill. “We're hopeful that a solution will be worked out between the House and Senate versions of the bill to expand energy development in the Gulf of Mexico that will create new American jobs, lower energy prices, and generate tens of millions of dollars in new revenue,” committee spokesman Michael Tadeo told ME.

** America’s first commercially produced advanced biofuel, biodiesel, is here, now — growing and diversifying our transportation energy portfolio. In fact, biodiesel producers have delivered more than a billion gallons of advanced biofuel the past two years running. Learn more today at www.AmericasAdvancedBiofuel.com.**

ON THE HILL THIS WEEK: With the shutdown creeping into its third week, there are few hearings on the Hill in the coming days, and only one of interest: The Oversight and Government Reform and Natural Resources Committees will hold a joint hearing Wednesday on the National Park Service's government shutdown implementation. Details: http://1.usa.gov/1gqSYws.

EPA TRIES TO QUELL FUROR OVER RFS LEAK: EPA sought Friday to contain a storm in the ethanol market after a leaked draft suggested the agency was considering sharply scaling back the amount of biofuels it requires to be blended in the nation’s gasoline supply. This week’s leak of EPA’s possible 2014 renewable fuels proposal was soon followed by a precipitous drop in the price of biofuel credits, known as renewable identification numbers, or RINs. That prompted EPA Administrator Gina McCarthy to try to calm the waters Friday. “At this point, EPA is only developing a draft proposal,” she said in a statement. “The agency has made no final decision on the proposed renewable fuel standards for 2014.” Erica Martinson has more: http://politico.pro/1gBVXlJ

WASHINGTON POST ENDORSES McAULIFFE, DINGS CUCCINELLI ON CLIMATE CHANGE: The Washington Post endorsed Democrat Terry McAuliffe in Virginia’s gubernatorial election over the weekend — and the paper’s editorial board made sure to slam Republican Ken Cuccinelli for his climate change-related investigations. “As attorney general, Mr. Cuccinelli waged a long and ultimately fruitless jihad against Michael Mann, a University of Virginia climate scientist, and filed a petition challenging the Environmental Protection Agency’s finding that global warming poses a threat to humans,” the paper wrote. “To Mr. Cuccinelli, the world is full of outrages that he would use government’s big stick to correct: Climate-change science is a hoax perpetrated on taxpayers.” More: http://wapo.st/1gAj549

DOE’S FISKER LOAN AUCTION CONTINUES: The auction for Fisker's outstanding $168 million loan from the Energy Department took place as scheduled on Friday, according to a DOE official. Now, DOE and other agencies will "evaluate the various bids and make a determination on which is in the best interest of the taxpayer," followed by negotiation on the sale, the official said. But you had better get settled in; the sale of the Vehicle Production Group’s outstanding $45 million loan took three weeks from auction date to announcement.

WEST COAST NEWS — CALIFORNIA PROGRAM DRAWS SCRUTINY: The Los Angeles Times writes about a California program that spent $1.6 billion last year on alternative energy and energy efficiency projects. “Even as California has scaled back education, law enforcement and assistance to the disabled in this era of financial stress, the energy program has continued unrestrained and is expected to grow significantly in coming years. State agencies have invested in milk trucks that run on cow manure, power plants fueled by ocean tides and artificial photosynthesis for powering vehicles and buildings. The spending is drawing increasing scrutiny. Some of the energy investments have gone bust, electricity costs have soared, and some economists have disputed the benefits. The legality of some consumer fees that fund the programs also is being challenged in court.”

LEE TERRY PICKS UP DEM CHALLENGER: Omaha city councilman Pete Festersen plans to run against Rep. Lee Terry (R-Neb.) next fall in a district frequently identified by Democrats as a potential pick-up — Terry won just 50.8 percent of the vote last year against Democrat John Ewing. Terry is part of the National Republican Congressional Committee's "Patriots Program," which helps vulnerable GOP members fundraise. Festersen, whom the Omaha World-Herald says got a call from Vice President Joe Biden urging him to enter the race, said the government shutdown and debt ceiling "brinksmanship" helped him decide to run. More from the OWH: http://bit.ly/1gANb7v

QUICK HITS

— Another coal miner died in an accident in Indiana — the 18th death this year and the fourth since the shutdown began about two weeks ago, Ken Ward Jr. notes at his Coal Tattoo blog: http://bit.ly/1ejPNoc

— California has banned the use of lead bullets, which can poison animals like the condor that eat shot from the ammunition, starting in July 2019. Los Angeles Times: http://lat.ms/19vBPyB

**You wouldn’t invest your life savings in just one stock. So why would America risk everything on a single transportation fuel? No matter how much oil we produce or where we produce it, having only one source to power our cars, trucks, trains and barges makes us vulnerable to a volatile global market.

America’s first commercially produced advanced biofuel, biodiesel, is here, now — growing and diversifying our transportation energy portfolio. In fact, biodiesel producers have delivered more than a billion gallons of advanced biofuel the past two years running. Learn more today at www.AmericasAdvancedBiofuel.com.**

** A message from Vet Voice Foundation: Tens of thousands of service members and veterans rely on public lands to hunt, fish, camp and heal from the wounds of war. These lands are part of the American heritage we fought for. As a new President and Congress look to rebuild America's infrastructure, we call on them to make an equal investment in maintaining our public lands and parks for our service members and all Americans. Support for our veterans must extend to investing in and protecting America’s natural heritage, for our children and grandchildren. www.VetVoiceFoundation.org **

Authors:

About The Author

Alex Guillén is an energy reporter for POLITICO Pro, where he covers EPA, regulations and coal, as well as lobbying and campaign finance in the energy realm. He previously wrote the Morning Energy newsletter. He graduated from the College of William and Mary in Williamsburg, Va., with a degree in anthropology and English. He is an avid reader and TV binger. The Delawarean, thrilled that there are finally Capriotti’s outposts in Washington, lives in Alexandria, Va.